The State of the US is Depressing – The Great Depression | BETWEEN 2 WARS I 1933 Part 2 of 3

On March 4, 1933, at the height of the Great
Depression, a new President of the United States of America takes the oath of office. President Franklin Delano Roosevelt has promised,
“a new deal for the American people” to take them out of their economic nose dive before
the American economy crashes completely and is literally bankrupt. There’s only one thing – no one, including
the President, really has a plan for how to do that. Welcome to Between-2-Wars a chronological
summary of the interwar years, covering all facets of life, the uncertainty, hedonism,
and euphoria, and ultimately humanity’s descent into the darkness of the Second World War. I’m Indy Neidell. In our 1929 episode on the Wall Street Crash,
we saw how it rocked not only the American economy but also the American dream of opportunity
for prosperity for all. The psychological effect had been immediate. Although the plummet in the value of the stock
market only directly affected a minority of Americans, its symbol as an indicator of economic
progress panicked the majority. Economic activity immediately slowed as Americans
reigned in spending. Now in 1933, the United States is caught in
the throes of the worst financial crisis that it has ever experienced- it is the Great Depression. But the Crash alone did not cause the Depression;
instead, subsequent crises created a domino effect tumbling the US into a dramatic economic
downturn. Even in 2019, historians still debate which
of these events is the event. There are some definite measurable effects
that we can conclude contributed in some way, how much is a matter for interpretation of
course. The first measurable effect is the Stock Market
collapse itself, which beyond the psychological impact also eliminates staggering amounts
of investment capital, impacting actual operations and production. Then the Smoot-Hawley Tariff Act in June 1930
creates some of the most radical protectionist trade policies in the history of the US. Raised tariffs on imported goods launch instant
retaliation from America’s trading partners with their own protectionist policies, which
in turn further exacerbates already ailing foreign trade. A bigger shock in monetary terms is the series
of bank collapses that follow the crash in waves. Some of these are tightly linked to the international
debt system, creating complex dependencies between US banks and the also suffering global
economy. Could it have been avoided? Well, that is a contentious issue that we
will never be able to conclude finally. Some economists say that intervention in the
banking system and more involvement of the Federal Reserve to prop up the banks could
have thwarted the crisis. Others claim the opposite; that it was too
much intervention by the Fed that tipped the balance. Followers of John Maynard Keynes idea that
an economy in shock is incapable of self-recovery, so stimulus through public spending and tax
cuts is your way out of the crisis say that that started too late. Opponents of the Keynesian theory say it shouldn’t
have started at all, and a lack of public finance austerity aggravated the crisis. And so on… in essence it’s complicated,
but I’m sure that quite a few of you have your own opinions to share and we’ll see
them in the comments. Whatever and whoever caused it, and whether
or not it could have been stopped, there is no debate about what actually happens. The banking system slides ever deeper into
crisis. In 1931 alone nearly 3,000 banks, holding
close to $1.7 billion in deposits, collapse. Many Americans will never see their savings
again. By 1932, 11.5 million Americans, around one-quarter
of the workforce, are unemployed. The unemployment rate for African-Americans
is at least 2 and in places 3 times above the national average. For those lucky enough to still be working,
underemployment is a fact of life. Pay and hours are slashed so that by the summer
of 1932, more than half of working Americans are only employed part-time. Whole families lose their sources of income,
are unable to make mortgage payments or pay rent, and lose their homes. Tumbling commodity prices, already a problem
for farmers in the “roaring twenties” continue to plummet. In 1929, cotton farmers received around 16
cents per pound, which drops to only 5 in the early years of the 1930s. And already before droughts hit, hundreds
of thousands of farming families become migratory farm workers, taking work wherever they can
find it. As incomes disappear, purchasing power drops,
sending prices tumbling, which in turn eliminates purchasing power from the sellers and wholesalers,
who have to drop prices further to move their product. A vicious circle that just pulls the economy
further and further into a tailspin. By 1933, industrial production will have fallen
by 37%, prices by 33%, and real GNP by 30%. The economic hardship has a massive affect
on social relations. No longer is there any clear separation between
destitute layabouts and well-to-do working Americans. And many middle-class Americans, who now find
themselves unemployed, struggle to accept the harsh reality that they too need public
assistance. A doctor working at a free clinic at the time
will recall in his later life: “people of that status would find it very
difficult to accept charity. […] Every day […] someone would faint
on a streetcar. They’d bring him in, and they wouldn’t ask
any questions […] they knew what it was. Hunger. When he regained consciousness, they’d give
him something to eat.” It is no wonder that the bitterness and impoverishment
of the era get reflected in one of the bestselling records of the time. Most famously recorded by Bing Crosby in 1932,
“Brother, Can You Spare a Dime?” and instantly an anthem of the time. [Indy picks up a guitar and Sings]
“They used to tell me I was building a dream And so I followed the mob
When there was earth to plow or guns to bear I was always there right on the job
They used to tell me I was building a dream With peace and glory ahead
Why should I be standing in line Just waiting for bread? Once I built a railroad, I made it run
Made it race against time Once I built a railroad, now it’s done
Brother, can you spare a dime?” If that isn’t enough to showcase the pessimism
of the time, then just look at how birth rates fall from close to three children per woman
in 1928 to 2.1 in 1936… people simply can’t afford to have children. Regardless if it’s his fault or not it reflects
poorly on incumbent President Hoover during the 1932 Presidential Election campaign. He had become an American icon during the
Great War when he was at the head of the Allied effort to feed the starving Belgian population. He had promised a glorious future for America
on the campaign trail and won by a landslide in 1928. But a sizable portion of the electorate now
sees his handling of the crisis as inadequate. Hoover believed that active government policy
was needed to ward off recession and in 1930 works to increase federal and state spending,
but the Depression only deepens. When his first measures have little effect,
Hoover tries again at the end of 1931 to save the economy and his Presidency. With the creation of the Reconstruction Finance
Corporation (RFC), he aims to lend public funds on a massive scale to banks and other
financial institutions. His program is historic. Never before in peacetime has a federal government
intervened so directly in the economy, but again it fails to thwart the recession. The fact that the RFC provides financial assistance
to banks but not ordinary Americans is used by the Democrats to accuse Hoover of being
too cozy with east-coast elites. And then a public relations disaster hits
Hoover at what Ironically is at the core of his reputation, the legacy of his WWI achievements. In 1924, Congress had passed the World War
Adjusted Compensation Act, or Bonus Act, which provided for a retirement payment to veterans. Immediate payments were limited and small,
but most veterans received what was called an “Adjusted Service Certificate,” a specified
bonus they were owed and could redeem after their birthday in the year 1945. When hard-times and unemployment befall them,
many veterans now hope that they can somehow receive this payment earlier. After all, if the government can literally
pay billions to the banks, then surely they can provide financial assistance to war heroes? It grows into a movement and hundreds of thousands
of what is quickly dubbed the ‘Bonus Army’ flock to Washington in the spring and summer
of 1932 to lobby for a new Bonus Bill which would release their payments earlier. They set up in one of the many makeshift shantytowns
popularly dubbed ‘Hoovervilles’ that have sprung up across the United States from rampant
homelessness. At first, the government tolerates the presence
of the Bonus Army. But even when their proposed bill is defeated
in mid-June, many still remain in the encampments. Tensions begin to mount. In late-July, Hoover orders the Army Chief
of Staff, General Douglas MacArthur, to clear out the main Bonus Army camp along the Anacostia
River. But MacArthur goes above and beyond his duty. He orders his soldiers to destroy the camp
and drive the veterans out of Washington altogether. They fire tear gas, advance with bayonets,
and burn the encampments. Most veterans flee, but some stay to fight,
hurling bricks or tin cans back at the marching soldiers. They’re not a real match for a fully equipped
army though. A certain Major by the name George S. Patton
is in charge of around 600 men in the operation and recalls: “Bricks flew, sabers rose and fell with a
comforting smack, and the mob ran. We moved on after them, occasionally meeting
serious resistance. Once six men in a truck threw a regular barrage
of bricks, and several men and horses were hit. Two of us charged at a gallop, and had some
nice work at close range with the occupants of the truck, most of whom could not sit down
for some days.” Many veterans had brought their families and
entire life possessions with them, and now the soldiers burn down what is essentially
their homes, with no regard for the fact that they are full of everything these families
own. Images of it all are picked up by the media,
with newspapers across the country covering the events, and the plight of the Bonus Army
now elicits mass sympathy amongst the public. Although it is MacArthur who is mostly responsible
for the overreach, the buck stops with the Commander in Chief who instantly faces an
even more significant loss in reputation. When Franklin D. Roosevelt, the Democratic
presidential nominee reads about the events in the New York Times, he expresses sympathy
for the veterans, but also some satisfaction, reportedly telling an aide that they no longer
need to take Hoover seriously as an opponent after such an unmitigated disaster. His prediction is correct. In November 1932, Roosevelt wins the Election
in a landslide, carrying 42 out of the 48 states for the Electoral College, and 57.4%
of the popular vote against Hoover’s 39.7%. But by the time FDR is inaugurated in March
1933, things have only gotten worse. Bank failures have surged, and state governors
across the country have declared mandatory bank holidays. In a desperate attempt to maintain prices,
farmers are now burning their crops. Ominously, and only weeks before he takes
office, Roosevelt survives an assassination attempt in Miami. But despite the pessimism gripping the country,
Roosevelt exudes optimism and confidence in his inaugural address. He challenges the millions of Americans who
are listening on their radios; to struggle with him to save America, famously declaring
“that the only thing we have to fear is…fear itself.” And he wastes no time before making changes. However, it’s not really a unified program,
it’s consistent improvisation and reaction. Nevertheless, he and his circle of advisors
–dubbed the ‘Brain Trust’ – now develop a set of policies that together will famously
become “The First New Deal.” His first priority is fixing the banking system. He declares a mandatory bank holiday and then
pushes the Emergency Bank Act into legislation. The act gives the government the power to
close banks in danger of failing and reopening those that will be stable. The Fed is empowered to pump more currency
into banks. These immediate measures do much to re-foster
public trust in the banking system so that depositors quickly stop hoarding their cash
and place it back into savings. The regular operation of banks begins again,
and the stock markets react positively. Although it’s difficult to discern any single
economic theory behind his policy, Roosevelt is certainly convinced that it is essential
to ‘reflate’ the economy, meaning that the severely depressed prices have to rise. For that, cash needs to move more freely though,
and with this in mind, he prohibits the private hoarding of gold currency and bullion, the
export of gold, and takes government control over domestic gold production already in early
April 1933. Two weeks later, on the 20th, he unlinks the
dollar from the gold standard to let it be traded at free market valuation. The dollar plunges by 11.5% against the European
currencies still held to the gold standard. This gives hope for increased exports, and
the stock market rises, enabling the acquisition of much-needed capital for the ailing industry. Social programs designed to stimulate the
economy are also introduced. The most famous is the Civilian Conservation
Corps (CCC). If they were single, healthy, unemployed,
and a member of a family on relief, young men could sign up to the Corps and go to help
preserve and repair America’s agricultural economy. Most of their wages will go to the man’s family
as he works to build bridges, prevent floods, save crops from grasshoppers, and other such
tasks. Huge stimulus packages are introduced. The Public Works Administration (PWA) is set
up and empowered with $3.3 billion, which is around 5.9% of the nations entire economy,
to fund large-scale public works such as dams, bridges, and schools. Other agencies are formed such as the Civil
Works Administration, a jobs creation program which by the end of the year 1933 has already
provided 4 million Americans with work. All of this is supported by a Presidential
public communications program, the first of its kind, with biweekly press conferences
where FDR continues to exude confidence. He frequently broadcasts his “fireside chats”
on the radio where he casually relays his policy to the public. But to turn around this huge drifting ship
that is the United States of America, and have her sailing at full speed again is no
small task, and it meets its challenges. Some of the programs that the FDR White House
introduces are seen as government overreach, one of them- the National Industrial Recovery
Act- is even found unconstitutional by the Supreme Court and overturned. At any rate, this unprecedented federal involvement
in the economy changes US politics forever. Also, In parallel to the economic downturn,
massive droughts strike the midwest in three waves to create the infamous and iconic Dust
Bowl. This part natural, part manmade disaster creates
terrible hardship across rural America. Nonetheless, the economy grows by over 10%
most years for the rest of the 1930s, though in 1937/38 it briefly slips back into recession
as FDR’s administration ends many of the New Deal programs. Taxes are raised so that the top tax bracket
is at 79% by 1936, raising accusations of damaging the free market economy through wealth
redistribution. Public debt soars from $23 billion in 1933
to $40 billion by 1939, leaving future administrations to deal with some of the effects. When the last drought ends, and the dust settles
in 1939, unemployment has sunk to 17%, but that’s far from full employment and GDP is
still not back to the 1929 level. The Great Depression, though, keeps the US
mostly involved with itself instead of taking an active part in the dramatic events of the
world in the 1930s. The crisis sends repercussions across the
globe, contributing to the destabilization of the world economy during the entire decade. In an ironic twist of history, it is the ensuing
global conflagration that which will finally bring America back from the precipice of bankruptcy
once and for all. If you’d like to see how the crisis begins,
then watch our video on the Wall Street Crash which you can click on right here… any moment
now… Our TimeGhost Army member of the week is Kristian
Petrov. With contributions from people like Kristian,
we can avoid Depression and continue doing more content like this. Be like Kristian and join the TimeGhost Army
on Patreon or Subscribe and ring the bell. And remember the wise words of Pythagoras:
“Concern should drive us into action, not into a depression. No man is free who cannot control himself.” Cheers!

About the author


  1. If you're new here, you might not be familiar with Indy Neidell and his other work. Not only are we doing 'Between Two Wars', on the events and years leading up to World War Two (of which this video is a part), also we're covering World War Two in realtime week-by-week, exactly 79 years after it all happened. We have now entered the second year of the war. If you haven't already, check out the World War Two Channel for what maybe one day will become the most complete account of The Second World War:


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  2. I am obssed with the lady in the green dress painting. The flowing lines of the gown contrasting with the harsh fingers in white, the light playing across her. I don't know how much thought went into putting her there, but I find her perfectly symbolic of the 20's to 30's

  3. That was amazing Indy. I didn't know you could play the guitar that good. Nor did I know Bing Crosby wrote a song about the depression, I only know his song "White Christmas". Really classic. 👏👏👏👏

  4. This episode brought back memories of my grand parents on both sides of my family and my aunts and uncles along with mother and father speaking of what it was like before WWII. My father's father was a veteran of both the mexican expedition and WWI. My Uncles worked in the CCC also. They were farmers and they spoke of many evening when they fed not only their family but anyone who happened by and needed a meal. My Mother raised chickens which were used to trade with the local merchant for sugar, salt and other home necessities. Times were hard they said, but they always got by, and then they'd laugh.

  5. If you look at the current unfunded liabilities – all of those programs started under the New Deal are broke. This time period set a standard of trying to re-inflate markets with government printing, and America got a massive boost during WW2 because the dollar seemed safe in a world torn apart by war. Post WW2 America became powerful because of the dollar standard (the whole world using the Dollar). All of this is coming to a head – right now – for various reasons, but keep in mind you have a major countries moving away from the dollar. The point is – The Great Depression was deflationary.. Great Depression 2.0 is going to be inflationary. Oddly enough if you want to protect yourself against what is coming – you need to do the opposite of what FDR was pushing. Gold / Silver are going to be worth a lot more in a world where the dollar is worth a lot less.

  6. How far goes the (capitalist) government to protect the wealthy and massacre the poor…
    Also, the people who tries to kill anyone who tries to do anything different, sick people. Some people really just don't deserves to live.

  7. Rap on Smoot-Hawley

    “You never let a serious crisis go to waste. And what I mean by that it's an opportunity to do things you think you could not do before.”

    -Rahm Emanuel

    In my opinion economist jumped on the economic downturn following passage of Smoot-Hawley to justify their anti-tariff position that had been wrong for more than a hundred years. 

    Now I know that all the smart people say Smoot-Hawley was a bad thing. And I know that Adam Smith and David Ricardo have theories saying tariffs are a bad thing. But I am an engineer and I like to look beyond what people say and consider the actual data. 

    The following presidents signed tariffs into law.

    George Washington
    Thomas Jefferson 
    James Madison Tariff of 1816 
    James Monroe Tariff of 1824 
    John Quincy Adams Tariff of 1828 (largest tariff in our history) 
    John Tyler Tariff of 1842 
    James Buchanan Tariff of 1861 
    Abraham Lincoln Tariff of 1864 
    William McKinley Tariff of 1897 
    William Howard Taft The Payne-Aldrich Tariff of 1909 
    Warren G. Harding The Fordney-McCumber Tariff If 1922 
    Herbert Hoover Smoot-Hawley Tariff Act of 1930

    Only one of 12 saw a decline in the economy after increasing tariffs all the others saw an improving economy. In other words 92 percent of the time when tariffs are increased the economy improves. 

    Smoot-Hawley was passed IN RESPONSE TO THE GREAT DEPRESSION it did not trigger the Great Depression.

    Second, it was only a small change over existing tariffs. The Fordney–McCumber Tariff of 1922 had set tariffs at 40 percent and Smoot-Hawley raised them to 46 percent which was in line with tariffs for the previous hundred years.

    More important at the time economist had been bloviating about the horrors of tariff protection for longer than we had been a nation. Beginning with the Tariff of 1816 and lasting until the Kennedy Round of Tariff Reductions in 1967 we were the most tariff protected country on earth. The Tariff of 1816 was our first protective tariff. It was followed by an improved economy. Tariff protection was increased in 1824 and the Tariff of 1828 was the highest tariff we ever had. Both produced economic gain. The Compromise Tariff of 1833 lowered the 1828 tariffs over a period of ten years. In 1842 Whigs, blaming the Panic of 1837 on low tariffs (most blame Andrew Jackson’s veto of a central bank), increased tariffs and the economy recovered. The election of 1844 put democrats in charge and they lowered tariffs to about 20 percent with the Tariff of 1846.  From the Tariff of 1861 until the Tariff of 1913 tariffs averaged more than 40 percent. During that time we became the most prosperous nation on earth. Eclipsing free trade advocate Great Britain. Grover Cleveland was elected president in 1892 just in time to get blamed for the Panic of 1893. His response was to lower tariffs with the Tariff of 1894. It did not work and the Democrats dropped Cleveland in favor of William Jennings Bryan who lost to ardent protectionist William McKinley. McKinley restored tariffs with the Tariff of 1897. Prosperity ensued. In 1913 tariffs were lowered. The same bill created income taxes. After World War I the USA went into a steep depression. Congress responded with the Fordney–McCumber Tariff of 1922 raising tariffs. The resulting economic prosperity is generally referred to as the “Roaring Twenties.” In June 1930 Congress responded to the Great Depression with the Smoot-Hawley tariff of 1930. This remains the only tariff increase in the entire history of the country that did not result in an improved economy. The bad economy of the 1930s started a full year before Smoot-Hawley.

    The Smoot-Hawley increase in tariffs over the 1922 Fordney–McCumber Tariff was small. An imported good that cost $1 would sell for $1.40 before Smoot-Hawley and $1.46 after, an increase of about 4 percent. No big deal. 

    When Hoover ignored economist there was no reason to believe they were correct. Mythology aside there is no evidence Smoot-Hawley made the economy worse. That tariff was repealed by 1936 but the Great Depression continued.

    It is said that Smoot-Hawley caused other nations to retaliate. The primary foreign response was the British Imperial Preference system that was a free trade agreement between the dominions and colonies providing tariff protection from others. This included Canada. This happened in 1932. This did indeed happened after Smoot-Hawley but was it a response? The fact that one event follows another does not prove the first event caused the second. Imperial Preferences were first advocated in the government of Prime Minister Arthur Balfour in 1903. In 1932 the system was pushed through parliament by Chancellor of the Exchequer Neville Chamberlain who got nostalgic about his father Joseph Chamberlain who as part of the Balfour government had first pushed for Imperial Preferences nearly 30 years before Smoot-Hawley. 

    Once again it looks like the claim Smoot-Hawley caused other nations to retaliate is more economists exploiting a crisis rather than a strong case.

    The claim that Smoot-Hawley was responsible for the decline in international trade is also weak. Note that when Trump announced tariffs on China trade from China increased. Importers wanted to import goods before the tariff took effect thus avoiding the tariff. Not so with Smoot-Hawley. International trade peaked in June 1929 a full year before passage. 

    If Smoot-Hawley was a bad thing why were previous tariffs not a bad thing? In “The Myth of Free Trade the Pooring of America” Dr. Ravi Batra summed up the real world experience of tariffs in the range of 40-50 percent after the Civil War this way.
    “Between 1869 and 1899, import volume of international trade fell far short of the growth in economic activity. Foreign competition became insignificant to most U.S. manufactures. Here, then, was the classic profile of an inward-looking economic system—one for which the advocates of free trade reserve their direst predictions. Here is a society which, according to their doctrine, would fritter away its precious resource; a society where the absence of foreign rivalry would lead to choking prices and shoddy products; where producers would have no incentive to innovate and improve; in short, a society that would gradually slide into mediocrity and even poverty”
    “What actually happened over these years is only too well known. The gross national product of the United States quadrupled between 1869 and 1900 when measured in constant (1929) dollars. In spite of a mushrooming population, real wages jumped 50 percent, retail prices tumbled 37 percent, and annual per capita income rose from $223 in 1869 to almost $500 in 1900.” 

    Tariff references

    Dr. Ravi Batra "The Myth of Free Trade the Pooring of America"
    F. W. Taussig "Tariff History of the United States"
    Douglas A. Irwin "Clashing over Commerce"
    Gabor S. Boritt “Lincoln and the Economics of the American Dream”

  8. Well, FDRs plan was SIMPLE!!!!!!!
    1. Steal gold from nearly every US citizen!
    2. Steal more money, and put it into a "trust fund" that even BILL CLINTON said was a trust fund on paper in the official budget while openly laughing at anyone that thought it was a trust fund. It is a SLUSH FUND used at THEIR pleasure!
    3. Steal MORE money for various projects.
    4. Pay people as they please. REGARDLESS of whether they EVER paid in, or are even citizens.
    The DJIA was created in 1896 was created based on the major industries of the day.
    BTW it is ironic that they passed the idiotic FED act on the promise that we would NEVER have another depression. Another 16 years later, we have a HUGE depression. That fed is the SAME one that hurt us in 1987, 1999, and had at least a hand in 2008!

    The radio might not have even been available in the US until the early 1900s.

    It is amazing though. I have spoken with people that have actually FORGOTTEN that soda cans, ONLY A COUPLE YEARS AGO, AND FOR DECADES EARLIER, were 16OZ. They ALSO forgot that the bottles were 20oz! NOW, the cans are 7.5oz. Last I checked, the bottles were 16.9oz! I wonder how small THEY are now. Assuming a relative decline in size, they are likely smaller than 8oz now! So the bottles would be about HALF the size of the old cans!!!!

  9. It was because of this that many considered Communism as a good system. The economy was better controlled. Under capitalism a deep recession is possible at short notice.

  10. The great "war heros" MacArthur and Patton taking down american veterans, i hope the american people remember this as well. Seriously why would anyone serve in the armed forces, risking their lives when the government just destroys their lives afterwards (modern days included, just think about veterans living on the streets….some of them injured phisically, mentally or both)

  11. I found an interesting nugget, and that was there was never a run on the San Francisco area banks. Indy, I was wondering if you covered this some where else. Supposedly it had something to do with the rebuilding capital coming from Germany since the Great Earthquake.

  12. New deal policies extended the great depression. You spoke of govt intervention with agriculture, thus resulting in the man made portion of the dustbowl, mainly from top down edict on what crops to grow resulting in not being able to replenish the soil. I find it almost an analogous omen of the famines to come in China under Mao and not learning from the Holodomor in Ukraine with respect to such top down intervention.

  13. Framing this episode as question is like like asking if Climate Change is real. When the industry have been profiting by bribing government officials and scientist for years, when they already knew that was true. Come on, cut the bullshit, this kind of things affect real people, have real consequences in the real world, and is not like wasn't implemented again, this kind of policies already have been implemented in the last thirty years so cut with the bullshit.

  14. One of the clearest explanations of the U.S. Great Depression. Oh, and there was reference to the evils of tariffs; perhaps a powerful American could learn from the mistakes of the past.

  15. Interestingly enough, the Great Depression was not the worst depression in US history. These episodes events tended to come in rapid cycles of crash and boom throughout the first 150 years of our nation's existence. We can never answer the question of whether the Great Depression would have quickly run its course or not if the government had stayed out trying to fix the economy, but we do know that 85 years since, we remain saddled with the vestiges and legacy of those attempts. One has to wonder if the crushing weight of ever growing government debt will bring about a repeat of the past.

  16. The signs were there far before 1929:

    The postwar “boom” of the 1920’s, marked by the Republican administration of Harding and then Coolidge, saw an explosion in both widespread, organized corruption and expansion of business under conservative policies. Through the Coolidge presidency the business-government bond was strengthened via lower taxes for the rich and the return of federally controlled war-industries to private hands. Challenged in 1924 by Wisconsin Senator La Follette, who called for a prewar-style of populism and progressivism, Coolidge and the conservatives managed to come out on top despite La Follette receiving 1/6 of the popular vote. The business-government alliance also shaped America’s foreign policy in things such as the “open door” policy of business-led intervention, renegotiation of war reparations, and establishment of peace through American economic and industrial hegemony and resource exploitation (particularly throughout Latin America). These business actions were often followed by state-backed military ones as well as full fledged invasions of nations throughout the American hemisphere.

    At the same time, while the industrial productive capacity of American cities almost doubled between 1921 and 1929, the industrial workforce barely grew and union membership fell. Service industries, finance, construction, and public utilities however all grew as the demographics of the nation shifted. Though all appeared prosperous, the disruptive shift in industries, unsound and speculative financial practices, and “overproduction” showed the signs of the coming economic collapse of the 1930’s. This was made worse by the Agriculture crisis of the 20’s, as wartime overexpansion of agricultural output in global and domestic markets coupled with debt of wartime-loans shrunk the number of farms and the amount of cultivated land in the country as industrial farming for cash crops took over. As the agricultural market shifted towards migrant labor and sharecropping/tenant farming the economic crisis for farmers was felt far before the collapse of the 30’s.

  17. It dumbfounds me that Americans didn't start a widespread revolution during the Great Depression. I legitimately never understood why that didn't happen.

  18. when you say birth rates dropped from 3 per woman to 2.1 per woman does that mean she has an abortion 1 month into the pregnancy or what?

  19. Don't forget the tanks used against the Bonus Army. It's NOT unimaginable why the Tiananmen Square incident did occur in 1989. Deng Xiaoping SAVED China through political realism in 1989. Now, if China fucks up again against Hong Kong – NOT learning all the methods of riot suppression from America against BLM and other Terrorist Groups – the CCP TRULY deserves to be overthrown this time around due to its INCOMPETENCE.

  20. the usa were foolish in battling for independence, the fed screwed the usa, if not for ww2 i doubt the usa's presence as a player at all.

  21. My family had a gardener who lived through the great depression. He referred to it as 'Hoover times'. We never heard him call it 'the depression'.

  22. See
    The Forgotten Man: A New History of the Great Depression
    Amity Shlaes

  23. There was a stock Market crash in 1920, no one remembers or talks about. As I recall it was Worst than 1929. 18 months later we were into to the roaring twenties. What did the Harding administration do? Well nothing.

    Depression of 1920–21

  24. Our host is multitalented. This is one of the best channels on Youtube. Interesting history narration, musical rendition and a well thought out set. Thanks, glad you keep this channel going.

  25. Imagine watching a "Between 2 Wars" video, and then out of nowhere Indy pops out a guitar and sings "Brother Can You Spare A Dime"

  26. Tax policy, at 18:50 – yes, FDR did spike the top tax bracket to nearly 80% in 1936… with the effect that federal tax revenues, which had been steadily and increasingly climbing since 1930, began falling again, not exceeding 1936's levels until 1940. High taxes on the rich led to the same sort of hoarding and disinclination to invest in the economy which had contributed to the Depression in the first place.

    Turns out, the law of diminishing returns applies to everything, including taxation of the rich. Don't kill your golden geese.

  27. I think that was just one big plan of american president to destroy by hunger black americans because of their threat to rich white capitalists

  28. Question: is there a fundamental difference between the ban on hoarding gold in the U.S. depression, and on hoarding grain as mentioned in the Holodomor? I know the end results were very different, but couldn't both have been justified by the crisis (real or imagined) at hand? Was it controversial at the time?

    You guys once said you read all comments, so I figured I outta take a shot.

  29. FDR campaigned on a platform of LOWERING taxes. Of course he broke his campaign pledge and raised taxes substantially. That, along with other bad policy decisions, made the depression last MUCH longer than it should have (the rest of the world was dragged into the depression by us. But the rest of the world got OUT of the depression far SOONER because they did NOT try government control of the economy. They simply let the market work (of course each country was different and places like the USSR were never going to give up government control of the economy).

  30. I went to an elementary school built by the WPA, I remember the initials on the foundation stone. If you visit rural counties in Virginia you'll find similar buildings in most counties. For many of these counties these were the first true public schools. Most of the buildings are no longer in use as schools, but the one I went to is still there, though you can't see the old foundation stone because it has been covered over by an addition to the building.

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